CAR INSURANCE firms are now offering a whole range of savings for customers after new guidance from the Financial Conduct Authority (FCA) came into effect on Monday.

Car insurance exports have urged motorists to “take advantage” of the savings to ensure they are getting “value for money” from their provider. Many insurers have already offered support to motorists but the new guidelines which came into effect yesterday means they are now obliged to help those in financial need.

A limited refund may also be considered for those paying annually while monthly customers may see a reduction in their monthly premium.

By Miles CEO James Blackham has campaigned heavily for changes to ensure motorists are not caught out with heavy costs during the lockdown.

Mr Blackham praised the move and urged all customers to contact their providers to see if their premiums can be temporarily reduced.

He said: “Anyone who has seen their mileage drop considerably due to the impact of coronavirus should get in touch with their insurer and ask to lower their annual mileage estimate - and therefore their monthly premiums.

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The agency has previously warned firms must be fair to motorists under the circumstances and ensure customers do not lose cover for simple issues.

The FCA guidelines clearly state firms can go above and beyond with extra payment holiday or discounts if they feel fit to do so.

This may be required if a customer is in serious financial strain and it would be in their best interests to offer further discounts.

The FCA has also urged firms to reassess their interest rates to see whether these are fair under the circumstances.

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Payment holidays will be offered to customers (Image: Getty)

Lousie O'Shea, CEO of Confused.com said the move was “encouraging” but urged motorists to get in touch with their individual insurers to see what savings may work for them.

She said: “Many of us are facing financial difficulties at the moment, so it’s encouraging to see the FCA leading with advice that insurers should be considerate and flexible around customers’ needs at this time.

"Some insurers have already rightly taken action to support customers, through offering premium reductions, discounts, waiving fees, and payment deferrals.

“These temporary measures will help to reduce monthly payments or if you have paid upfront, receive a refund.

‘Whilst a positive move, it’s important that we get in contact with our insurers to find out the best solution available to each of us.”